On Sunday, Mrs O’Neill was guest speaker at an event in Cappagh, Co Tyrone, held for eight IRA men shot dead by the SAS in Loughgall in 1987.
The men were killed as they approached Loughgall RUC station with a bomb in a hijacked digger. A civilian was also killed in the ambush.
Mrs O’Neill has come in for criticism over her attendance from both unionist politicians and victims of IRA violence.
Speaking on BBC’s The Nolan Show this morning, former DUP MLA Nelson McCausland said Mrs O’Neill’s actions made it “very, very difficult” for his party to reach a deal with Sinn Fein to save the power-sharing institutions in Northern Ireland.
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He added: “There is a constant programme of events such as this where IRA terrorists are being celebrated and it is that sense of pride that Michelle O’Neill talks about that grates so much with people.
“I think there was a hope that with the passage of time there might be a change of tone from Sinn Fein, but actually that speech was more strident than we have seen for quite a long time.”
Mr McCausland also said Mrs O’Neill’s language stood in “stark contrast” to the actions of DUP leader Arlene Foster, who last week met with several Irish speaking groups as part of her pledge to better understand the language.
Mr McCausland added: “While Arlene Foster was reaching out, but Michelle O’Neill was engaging in a nasty and polarising speech.
“What we saw at the weekend showed no respect at all for those who survived IRA atrocities of for the families of those who were murdered by the East Tyrone brigade of the IRA.”
UUP MP Tom Elliot told the Nolan Show: “I have no difficulty with these people remembering their loved ones in their own way, but not by going out and commemorating them in the way Michelle O’Neill has done.”
Defending Mrs O’Neill’s speech at the commemoration event, former Sinn Fein MLA Daithi McKay added: “Michelle O’Neill is a republican and people should not be surprised when she attends republican commemorations.
“The question should be asked, does this make it harder for republicans to engage with unionists when commemorations are being used to score political points.”